This page has been archived and commenting is disabled.
Seattle FHLB - Toast
- advertisements -
Contact Information:
Tips: tips [ at ] zerohedge.com
General: info [ at ] zerohedge.com
Legal: legal [ at ] zerohedge.com
Advertising: ads [ at ] zerohedge.com
Abuse/Complaints: abuse [ at ] zerohedge.com
Suggested Reading:
Make sure to read our "How To [Read/Tip Off] Zero Hedge Without Attracting The Interest Of [Human Resources/The Treasury/Black Helicopters]" Guide
It would be very wise of you to study our disclaimer, our privacy policy and our (non)policy on conflicts / full disclosure. Here's our Cookie Policy.
The FHLBs were the first line of defense in the unfolding disaster. The swimmers continue to ignore all the floating turds until they clog the airway.
Reading this entire document, this sentence caught my eye, too.
However, Acting Director DeMarco made the discretionary determination, authorized by statute, that the Seattle Bank is "Undercapitalized" because of several factors, including the possibility that modest declines in the value of its private-label mortgage-backed securities could cause it again to fall below its risk-based capital requirement.
(emphasis added)
I haven't checked any older releases, but it looks like it's been "undercapitalized" before.
Yikes!
Old news really. They will remain undercapitalized until they require a suprise bailout.
Basically, so what? What's the possible fallout? Government prints up some money for the vaults at the Fed so capital ratios look good, ergo nobody cares? Small and middle sized bank owners don't get dividend flow, causing knocks to their ratios, forcing them to fail, equity values wiped out wholesale, too many for the government to handle, none too big to fail or big enough to have bought legislators, so they all go down and spark broader declines to below previous lows? What?
No the FHLB are not owned by the taxpayers and have not received Govt funds. They are owned by member banks which are most of the nations small and medium size banks. The FDIC can't shut them down. That would have to be the FHFA.
Dude, that sounds FHKD up.
I'm surprised that any of the FHLB banks were still paying dividends or redeeming stock. Especially Seattle, given that most of its member banks (e.g. AWBC, CTBK, FTBK, HRZB, RPFG, STSA) are basically insolvent and waiting for FDIC closure.
Gosh..i'm ignorant..is this already an agency-owned lender or, is it a private bank?
As of now you own them. Sorry.
Bruce, I don't see this post on your blogspot site
http://brucekrasting.blogspot.com/
The reason I went to look is that the right-hand-side of this post is overwritten by ads and is not completely visible (to me, I guess I can try other browsers...)
...or go to "Printer Friendly"
Reduce the screen resolution/ control - shift -or go into display size /reduce Maybe like 1280 x800.
Stretch the screen wider with the arrow gizmo on the lower right??
Quick let's give the IMF some gold so they can sell it loan some money to them.
FHLB's beg for accounting relief on hold-to-maturity RMBS, get it, and they still can't make regulatory capital requirements.
http://www.nypost.com/p/news/business/don_bank_on_it_WUGfFkjYU7IvXsl1wXueYJ
What happen to their request for TARP money? It looks like Paul Miller (FBR) told the NY Post he thought the Fed would bail them out at the begining of the year. Hopefully the government knows at least one of them needs to fail and be absorbed into the others.
Housingwire warned about how the FHLB's cash flow problem (due to buying risky RMBS) would effect it's member banks at the begining of the year.
http://www.housingwire.com/2009/01/09/banks-may-take-hit-on-fhlb-stock-h...
Not surprised. More to come.
Looks like DeMarco doesn't see a cure on the horizon for collateral values. So he imposes a no dividend hand slap....beautiful.
The camels die, but the caravan moves on.